SVMH receives financial audit

Salinas Valley Memorial Hospital officials received the draft state audit of the hospital's finances and operations, and the board of directors is poised to deliver a response today.

The hospital's board met in closed session Wednesday to consider a response to the Bureau of State Audits' confidential report, which was reportedly reviewed by board members under tight restrictions earlier in the week.

Interim CEO Lowell Johnson allowed one board member at a time to view the report, and only one copy exists.

Hospital officials were stunned by the leak of a confidential report on a possible merger last year to local media.

Margarita Fernandez, spokeswoman for the Bureau of State Audits, said it is a misdemeanor for the bureau or the hospital to release the draft report or its contents.

Fernandez said a final audit report, including the hospital's response, will be released to the public March 8.

She said hospital officials will be required to file a series of responses to the recommendations in the report, due 60 days after the final report is issued, then in six months and a year.

The bureau will issue a follow-up report after a year, she said.

The state Joint Legislative Audit Committee approved the audit of Salinas Valley Memorial in May after a request by State Assemblyman Luis Alejo, D-Watsonville.

Alejo and others raised questions about the hospital's fiscal management and policies, including executive pay and pensions, potential conflicts of interest involving charitable organizations such as the air show in Salinas, and public transparency.